EMS climbing back with fresh look, larger stores

Saturday

Sep 27, 2008 at 12:01 AMSep 27, 2008 at 11:58 AM

Sometimes, you've got to climb down into a valley if you want to reach that peak. Just ask the folks at Eastern Mountain Sports, the outdoor gear retailer that has been undergoing a slow and steady transformation since its management-led buyout with private equity firm J.H. Whitney & Co. in 2004.

Jon Chesto

Sometimes, you've got to climb down into a valley if you want to reach that peak.

Just ask the folks at Eastern Mountain Sports, the outdoor gear retailer that has been undergoing a slow and steady transformation since its management-led buyout with private equity firm J.H. Whitney & Co. in 2004.

The Peterborough, N.H.-based chain has shed more stores than it opened each year since that buyout took place - until now.

Scott Barrett, the company's chief marketing officer, says EMS will finish its current fiscal year with 68 stores, including one that just opened in Foxboro a week ago. That's a far cry from the 86 stores EMS operated in 2004, but it will mark the first time in four years when the number of stores has actually increased.

The retailer is pursuing ambitious growth plans: It aims to operate 90 stores in New England, New York and the Mid-Atlantic states by the end of 2012 - all in its new, larger format. Barrett estimates that the company will pump more than $1 million into renovations at each of the modern stores that it opens.

To prepare for its current growth run, the EMS management team led by CEO Will Manzer needed to take a hard look at the chain's real estate portfolio.

The biggest reason for the drop in the store count was a decision to completely exit markets where EMS had failed to build a strong brand presence. That meant pulling up stakes in Colorado, Michigan and Western Pennsylvania and concentrating efforts in East Coast states where the chain is already well-known.

Under previous owner American Retail Group, EMS had put more than a third of its stores in indoor mall locations. But four-person tents and 16-foot-long kayaks aren't exactly easy to carry out to the car. Try doing it when you're navigating a packed shopping mall.

So EMS has been shifting out of the indoor malls as its leases come up for renewal, and it has only 11 remaining mall stores out of an original 30, Barrett says. EMS typically looks to set up another shop in the same market.

But that switch doesn't necessarily happen overnight because the company has been picky about the sites where it opens new stores. For example, the store that just opened at Patriot Place in Foxboro is partially aimed at replacing a shop at the Emerald Square Mall in North Attleboro that closed more than two years ago.

EMS executives also wanted to freshen the look of the stores and open them up a bit, remedying the cramped feel that many of them had and making room for a full-service bike repair and bike sales area.

At the time of the buyout, most of the stores were 7,000 square feet in size or smaller. The company's managers now want EMS stores to be at least twice that size, such as the 14,600-square-foot location in Foxboro - the chain's 15th store in its new format.

The emphasis on bigger stores means the chain's total retail square footage will be significantly larger than it was in 2004 when it returns to the full store count it had at the time of the management buyout.

The chain's roots are here in Massachusetts: The company was founded in Wellesley 41 years ago by two climbers, and its store on Commonwealth Avenue in Boston is its oldest location. Still, Barrett says he sees some room for additional stores in the Boston metro area.

The company will continue to replace or expand existing shops even as it looks to fill in gaps in its core market - which stretches from Maine to the Washington metro area - with a goal of spreading its new format throughout the entire chain in the next four years.

Barrett says the chain isn't wavering from its expansion plan to open another 22 stores during the next four years in the face of the current economic slowdown.

Barrett admits that a prolonged downturn in the overall economy could slow the company's course. But for now, EMS is plowing forward like a determined hiker. EMS has hit its valley, and is marching steadily up the other side with its tallest peak in its sights.

Jon Chesto is the business editor of The Patriot Ledger. He may be reached at jchesto@ledger.com.

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